Compilation of Selected Fifteen Organizational Behaviour Cases

Compilation of Selected Fifteen Organizational Behaviour Cases

Compiled by

Bhuwan R. Chataut

Faculty – HRM/OB

Shanker Dev Campus, Putali Sadak

Uniglobe College, New Baneshwor

www.facebook.com/bhuwanrchataut

Credit

Fred Luthans Organizational Behavior: An Evidence-Based Approach (2011) 12e McGraw-Hill

Stephen P. Robbins & Timothy A. Judge Organizational Behavior (2013) 15e Prentice Hall

John R. Schermerhorn, Jr., Richard N. Osborn, Mary Uhl-Bien & James G. Hunt Organizational Behavior (2012) 12e  John Wiley & Sons

(This compilation is prepared just to practice individually by learner – not for any commercial purpose. All the materials here used are copyrighted.)

OB Case I Lessons for ‘Undercover’ Bosses

Executive offices in major corporations are often far removed from the day-to-day work that most employees perform. While top executives might enjoy the perquisites found in the executive suite, and separation from workday concerns can foster a broader perspective on the business, the distance between management and workers can come at a real cost: top managers often fail to understand the ways most employees do their jobs every day. The dangers of this distant approach are clear. Executives sometimes make decisions without recognizing how difficult or impractical they are to implement. Executives can also lose sight of the primary challenges their employees face.

The practice of “management by walking around” (MBWA) works against the insularity of the executive suite. To practice MBWA, managers reserve time to walk through departments regularly, form networks of acquaintances in the organization, and get away from their desks to talk to individual employees. The practice was exemplified by Bill Hewlett and Dave Packard, who used this management style at HP to learn more about the challenges and opportunities their employees were encountering. Many other organizations followed suit and found that this style of management had advantages over a typical desk-bound approach to management. A recent study of successful Swedish organizations revealed that MBWA was an approach common to several firms that received national awards for being great places to work.

The popular television program Undercover Boss took MBWA to the next level by having top executives from companies like Chiquita Brands, DirectTV, Great Wolf Resorts, and NASCAR work incognito among line employees. Executives reported that this process taught them how difficult many of the jobs in their organizations were, and just how much skill was required to perform even the lowest-level tasks. They also said the experience taught them a lot about the core business in their organizations and sparked ideas for improvements.

Although MBWA has long had its advocates, it does present certain problems. First, the time managers spend directly observing the workforce is time they are not doing their core job tasks like analysis, coordination, and strategic planning. Second, management based on subjective impressions gathered by walking around runs counter to a research and data-based approach to making managerial decisions. Third, it is also possible that executives who wander about will be seen as intruders and overseers. Implementing the MBWA style requires a great deal of foresight to avoid these potential pitfalls.

Questions:

1. What are some of the things managers can learn by walking around and having daily contact with line employees that they might not be able to learn from looking at data and reports?

2. As an employee, would you appreciate knowing your supervisor regularly spent time with workers? How would knowing top executives routinely interact with line employees affect your attitudes toward the organization?

3. What ways can executives and other organizational leaders learn about day-to-day business operations besides going “undercover?”

4. Are there any dangers in the use of a management by walking around strategy? Could this strategy lead employees to feel they are being spied on? What actions on the part of managers might minimize these concerns?

OB Case II Crisis Blown Over

November 30, 1997 goes down in the history of a Bangalore-based electric company as the day nobody wanting it to recur but everyone recollecting it with sense of pride.

It was a festive day for all the 700-plus employees. Festoons were strung all over, banners were put up; banana trunks and leaves adorned the factory gate, instead of the usual red flags; and loud speakers were blaring Kannada songs. It was day the employees chose to celebrate Kannada Rajyothsava, annual feature of all Karnataka-based organisations. The function was to start at 4 p.m. and everybody was eagerly waiting for the big event to take place.

But the event, budgeted at Rs 1,00,000 did not take place. At around 2 p.m., there was a ghastly accident in the machine shop. Murthy was caught in the vertical turret lathe and was wounded fatally. His end came in the ambulance on the way to hospital.

The management sought union help, and the union leaders did respond with a positive attitude. They did not want to fish in troubled waters.

Series of meetings were held between the union leaders and the management. The discussions centred around two major issues—(i) restoring normalcy, and (ii) determining the amount of compensation to be paid to the dependants of Murthy.

Luckily for the management, the accident took place on a Saturday. The next day was a weekly holiday and this helped the tension to diffuse to a large extent. The funeral of the deceased took place on Sunday without any hitch. The management hoped that things would be normal on Monday morning.

But the hope was belied. The workers refused to resume work. Again the management approached the union for help. Union leaders advised the workers to resume work in al departments except in the machine shop, and the suggestions were accepted by all.

Two weeks went by, nobody entered the machine shop, though work in other places resumed. Union leaders came with a new idea to the management—to perform a pooja to ward off any evil that had befallen on the lathe. The management accepted the idea and homa was performed in the machine shop for about five hours commencing early in the morning. This helped to some extent. The workers started operations on all other machines in the machine shop except on the fateful lathe. It took two full months and a lot of persuasion from the union leaders for the workers to switch on the lathe.

The crisis was blown over, thanks to the responsible role played by the union leaders and their fellow workers. Neither the management nor the workers wish that such an incident should recur.

As the wages of the deceased grossed Rs 6,500 per month, Murthy was not covered under the ESI Act. Management had to pay compensation. Age and experience of the victim were taken into account to arrive at Rs 1,87,000 which  was the amount to be payable to the wife of the deceased. To this was added Rs 2,50,000 at the intervention of the union leaders. In addition, the widow was paid a gratuity and a monthly pension of Rs 4,300. And nobody’s wages were cut for the days not worked.

Murthy’s death witnessed an unusual behavior on the part of the workers and their leaders, and magnanimous gesture from the management. It is a pride moment in the life of the factory.

Questions:

a.       What made employee union respond positivity to solve the crisis?

b.      Define following variables and identify the incidents that best describes them.

i. Beliefs          ii.  Values        iii. Attitudes    iv. Behavior

c.       Explain the factors that shape attitudes?

d.      Distinguish attitudes and values in points.

OB Case III Same Accident, Different Pereptions

According to the police report, on July 9 at 1:27 P.M., bus number 3763 was involved in a minor non-injury accident. Upon arriving at the scene of the accident, police were unable to locate the driver of the bus. Because the bus was barely drivable, the passengers were transferred to a backup bus, and the damaged bus was returned to the city bus garage for repair.

The newly hired general manager, Aaron Moore, has been going over the police report and two additional reports. One of the additional reports was submitted by Jennifer Tye, the transportation director for the City Transit Authority (CTA), and the other came directly from the driver in the accident, Michael Meyer. According to Tye, although Mike has been an above-average driver for almost eight years, his performance has taken a drastic nosedive during the past 15 months. Always one to join the other drivers for an afterwork drink or two, Mike recently has been suspected of drinking on the job. Furthermore, according to Tye’s report, Mike was seen having a beer in a tavern located less than two blocks from the CTA terminal at around 3 P.M. on the day of the accident. Tye’s report concludes by citing two sections of the CTA Transportation Agreement. Section 18a specifıcally forbids the drinking of alcoholic beverages by any CTA employee while on duty. Section 26f prohibits drivers from leaving their buses unattended for any reason. Violation of either of the two sections results in automatic dismissal of the employee involved. Tye recommends immediate dismissal.

According to the driver, Michael Meyer, however, the facts are quite different. Mike claims that in attempting to miss a bicycle rider he swerved and struck a tree, causing minor damage to the bus. Mike had been talking with the dispatcher when he was forced to drop his phone receiver in order to miss the bicycle. Because the receiver broke open on impact, Mike was forced to walk four blocks to the nearest phone to report the accident. As soon as he reported the accident to the company, Mike also called the union to tell them about it. Mike reports that when he returned to the scene of the accident, his bus was gone. Uncertain of what to do and a little frightened, he decided to return to the CTA terminal. Because it was over a five-mile walk and because his shift had already ended at 3 P.M., Mike stopped in for a quick beer just before getting back to the terminal.

Questions:

1. Why are the two reports submitted by Jennifer and Mike so different? Did Jennifer and Mike have different perceptions of the same incident?

2. What additional information would you need if you were in Aaron Moore’s position? How can he clarify his own perception of the incident?

3. Given the information presented above, how would you recommend resolving this problem?

OB Case IV Is There a Price for Being Too Nice?

Agreeable people tend to be kinder and more accommodating in social situations, which you might think could add to their success in life. However, we’ve already noted that one downside of agreeableness is potentially lower earnings. We’re not sure why this is so, but agreeable individuals may be less aggressive in negotiating starting salaries and pay raises.

Yet there is clear evidence that agreeableness is something employers value. Several recent books argue in favour of “leading with kindness” (Baker & O’Malley, 2008) and “capitalizing on kindness” (Tillquist, 2008). Other articles in the business press have argued that the sensitive, agreeable CEO—such as GE’s Jeffrey Immelt and Boeing’s James McNerney—signals a shift in business culture (Brady, 2007). In many circles, individuals desiring success in their careers are exhorted to be “complimentary,” “kind,” and “good” (for example, Schillinger, 2007).

Take the example of 500-employee Lindblad Expeditions. It emphasizes agreeableness in its hiring decisions. The VP of HR commented, “You can teach people any technical skill, but you can’t teach them how to be a kind-hearted, generous-minded person with an open spirit.”

So, while employers want agreeable employees, agreeable employees are not better job performers, and they are less successful in their careers. We might explain this apparent contradiction by noting that employers value agreeable employees for other reasons: they are more pleasant to be around, and they may help others in ways that aren’t reflected in their job performance. Most evidence suggests that agreeable people like agreeable people, which you might expect because people like those who are similar to themselves. However, even disagreeable people like agreeable people, perhaps because they are easier to manipulate than individuals who are lower in agreeableness. Perhaps everyone wants to hire agreeable people just because everyone likes to be around them.

Moreover, a 2008 study of CEO and CEO candidates revealed that this contradiction applies to organizational leaders as well. Using ratings made by an executive search firm, researchers studied the personalities and abilities of 316 CEO candidates for companies involved in buyout and venture capital transactions. They found that what gets a CEO candidate hired is not what makes him or her effective. Specifically, CEO candidates who were rated high on “nice” traits such as respecting others, developing others, and teamwork were more likely to be hired. However, these same characteristics—especially teamwork and respecting others for venture capital CEOs—made the organizations they led less successful.

Questions:

1. Do you think there is a contradiction between what employers want in employees (agreeable employees) and what employees actually do best (disagreeable employees)? Why or why not?

2. Often, the effects of personality depend on the situation. Can you think of some job  situations in which agreeableness is an important virtue? And in which it is harmful?

3. In some research we’ve conducted, we’ve found that the negative effects of agreeableness on earnings is stronger for men than for women (that is, being agreeable hurt men’s earnings more than women’s). Why do you think this might be the case?

OB Case V A Tardiness Problem

You have been getting a lot of complaints recently from your boss about the consistent tardiness of your department’s sales associates at a large retail store. The timesheet records indicate that your people’s average start-up time is about 10 minutes late. Although you have never been concerned about the tardiness problem, your boss is really getting upset. He points out that the tardiness reduces the amount of time associates are providing assistance and replenishing items on display. You realize that the tardiness is a type of avoidance behaviour—it delays the start of a very boring job. Your work group is very cohesive, and each of the members will follow what the group wants to do. One of the leaders of the group seems to spend a lot of time getting the group into trouble. You want the group to come in on time, but you don’t really want a confrontation on the issue because, frankly, you don’t think it is important enough to risk getting everyone upset with you. You decide to use an O.B. Mod. approach.

Questions:

1. Trace through the five steps in the O.B. Mod. Model to show how it could be applied to this tardiness problem. Make sure you are specific in identifying the critical performance behaviours and the antecedents and consequences of the functional analysis.

2. Do you think the approach you have suggested in your answer will really work? Why or why not?

OB Case VI Volunteers can’t be punished

Jenette Jackson is head of a volunteer agency in a large city, in charge of a volunteer staff of over 25 people. Weekly, she holds a meeting with this group in order to keep them informed and teach them the specifics of any new laws or changes in state and federal policies and procedures that might affect their work, and she discusses priorities and assignments for the group. This meeting is also a time when members can share some of the problems with and concerns for what they are personally doing and what the agency as a whole is doing.

The meeting is scheduled to begin at 9 A.M. sharp every Monday. Lately, the volunteers have been filtering in every five minutes or so until almost 10 A.M. Jenette has felt she has to delay the start of the meetings until all the people arrive. The last few weeks the meetings haven’t started until 10 A.M. In fact, at 9 A.M, nobody has shown up. Jenette cannot understand what has happened. She feels it is important to start the meetings at 9 A.M so that they can be over before the whole morning is gone. However, she feels that her hands are tied because, after all, the people are volunteers and she can’t push them or make them get to the meetings on time.

Questions:

1. What advice would you give Jenette? In terms of reinforcement theory, explain what is happening here and what Jenette needs to do to get the meetings started on time.

2. What learning theories (operant, cognitive, and/or social) could be applied to Jenette’s efforts to teach her volunteers the impact of new laws and changes in state and federal policies and procedures?

3. How could someone like Jenette use modeling to train her staff to do a more effective job?

OB Case VII People problem at HEI

After graduating with honors with a management major from State University, Ashley James accepted an entry-level position in the Human Resources Department of Hospital Equipment Inc. (HEI), a medium-sized manufacturer of hospital beds and metal furniture (bedstands, tables, cabinets, etc.). This hospital room product line has been a “cash cow” for HEI since the founding of the firm 35 years ago by James Robinson, Sr. In recent years, however, HEI’s market share has become eroded by some of the big office furniture firms, both in the United States and abroad, who are starting to diversify into the health institution market.

Mr. Robinson has been easing into retirement the last couple of years. His only child, Rob, was made CEO

three months ago. Rob came up through product engineering for two years and then headed up operations for the past four years. Rob had been a three-sport star athlete and student body president in high school. He then went on to State University where he graduated near the top of his class in mechanical engineering.

In his new leadership role at HEI, Rob’s vision is to take the firm from being a low-tech bed and metal furniture manufacturer that is going downhill to become a high-tech medical equipment manufacturer. Rob is convinced that even though this would be a dramatic change for HEI, there is enough of a foundation and culture in place to at least start a new division focused initially on operating room equipment.

Rob’s marketing manager had commissioned a study with a marketing research firm that concluded operating room equipment supply was not keeping up with demand and was way behind the rest of the health care supply industry in terms of innovative technology for patient comfort and care. The marketing manager, armed with this information, enthusiastically supported Rob’s vision for the future of HEI.

The finance and operations people are another story. The finance manager is very pessimistic. HEI is already under a cash flow strain because of decreasing revenues from their existing product line and, although they currently have very little long-term debt, with Robinson Senior retiring, his contacts and long-term friends in the local lending community were gone. Only the big corporate banks with decision makers in other cities are left. The new head of operations, who has been very close to Robinson Senior over the years and had basically run the show for Rob the past four years, is also very pessimistic. In a recent executive committee meeting where Rob had asked for input on his vision for HEI, this operations head angrily blurted out, “I know we have to do something! But medical equipment? I have absolutely no hope that our engineers or operating people have the capacity to move in this direction. As you know, almost all of our people have been with us at least 15 to 20 years. They are too set in their ways, and the only way we could start a new medical equipment division would be from scratch, and I certainly don’t see the funding for that!”

After weighing his senior management team’s advice, consulting with his dad, doing some research on

his own, and tapping his network of friends in and outside the industry, Rob decided to go ahead with the planning of a new medical equipment division. He also decided that this new division would have to be run by present people and he would seek no outside funding. At this point, he called in the young Ashley James from the HR department and gave her the following assignment:

Ashley, I know you haven’t been around here very long, but I think you can handle the challenge that I am going to give you. As you probably know by now, HEI is having some difficulties, and I have decided we need to move in a new direction with a medical equipment division. As I see it, we have some real people problems to overcome before this will be a success. Having worked in operations the past several years, I am convinced we have enough raw talent in both engineering and at the operating level to make the transition and pull this off successfully. But I need your help. Did you come across anything in your program at State U. that had to do with getting people to be more positive, more optimistic, and confident? I really think this is the problem, starting with management and going right down the line. I want you to take a week to think about this, talk to everyone involved, do some research, and come back with a specific proposal of what HR can do to help me out on this. The very survival of HEI may depend on what you come up with.

Questions:

1. On the basis of the limited information in this case, how would you assess the efficacy, optimism, hope, resiliency, and overall psychological capital of Rob? Of the operations manager? Give some specifics to back your assessment. What implications do these assessments have for the future of HEI?

2. What’s your reaction to the finance manager’s pessimism? What about the market manager’s optimism?

What implications does this have for Rob and the company?

3. Do you agree with Rob’s decision? Would you like to work for him? Why or why not?

4. If you were Ashley, what specific proposal would you make to Rob? How would you implement such a proposal?

OB Case VIII It’s not fair

Few topics in the business press have grabbed more headlines recently than highly lucrative annual bonuses for top management. Critics bemoan the multimillion- dollar compensation packages offered in the financial services industry in particular, following the dire consequences of the meltdown of this sector a few short years ago.

How is executive compensation determined by compensation committees? Some researchers suggest that principles from equity theory (making comparisons to referent others) might explain variations in executive pay. To set what is considered a “fair” level of pay for top executives, members of the board find out how much executives with similar levels of experience in similar firms (similar inputs) are being paid and attempt to adjust compensation (outcomes) to be equitable. In other words, top executives in large oil firms are paid similarly to top executives in other large oil firms, top executives in small hospitals are paid similarly to top executives in other small hospitals. In many cases, simply changing the referent others can change the salary range considered acceptable. According to one view of justice theory, this should be perceived as equitable, although executives may encourage boards to consider specific referent others who are especially well-paid.

Critics of executive compensation change the debate by focusing on the ratio of executive compensation to that of the company’s lowest-paid employees. Researcher Cary Cooper notes, “In business, it is important to reward success and not simply status.” Cooper believes all employees should share the company’s good fortune in profitable periods. He has recommended that CEO compensation be capped at 20 times the salary of the lowest-paid employee. In fact, the average S&P 500 CEO is paid 263 times what the lowest-paid laborer makes. This is eight times more than the ratio from the 1950s, which might serve as another reference point for determining what is considered “fair.”

Questions

1. How does the executive compensation issue relate to equity theory? Who do you think should be the referent others in these equity judgments? What are the relevant inputs for top executives?

2. Can you think of procedural justice implications related to the ways pay policies for top executives have been instituted? Do these pay-making decisions follow the procedural justice principles outlined in the chapter?

3. Do you think the government has a legitimate role in controlling executive compensation? How might we use distributive and procedural justice theories to inform this debate?

4. Are there any positive motivational consequences of tying compensation pay closely to firm performance?

OB Case IX The forgotten group member

The Organizational Behavior course for the semester appeared to promise the opportunity to learn, enjoy, and practice some of the theories and principles in the textbook and class discussions. Christine Spencer was a devoted, hard-working student who had been maintaining an A–average to date. Although the skills and knowledge she had acquired through her courses were important, she was also very concerned about her grades. She felt that grades were paramount in giving her a competitive edge when looking for a job and, as a third-year student; she realized that she’d soon be doing just that.

Sunday afternoon. Two o’clock. Christine was working on an accounting assignment but didn’t seem to be able to concentrate. Her courses were working out very well this semester, all but the OB. Much of the mark in that course was to be based on the quality of groupwork, and so she felt somewhat out of control.

She recollected the events of the past five weeks. Professor Sandra Thiel had divided the class into groups of five people and had given them a major group assignment worth 30 percent of the final grade. The task was to analyze a seven-page case and to come up with a written analysis. In addition, Sandra had asked the groups to present the case in class, with the idea that the rest of the class members would be “members of the board of directors of the company” who would be listening to how the manager and her team dealt with the problem at hand.

Christine was elected “Team Coordinator” at the first group meeting. The other members of the

group were Diane, Janet, Steve, and Mike. Diane was quiet and never volunteered suggestions, but when directly asked, she would come up with high-quality ideas. Mike was the clown. Christine remembered that she had suggested that the group should get together before every class to discuss the day’s case.

Mike had balked, saying “No way!! This is an 8:30 class, and I barely make it on time anyway! Besides, I’ll miss my Happy Harry show on television!” The group couldn’t help but laugh at his indignation. Steve was the businesslike individual, always wanting to ensure that group meetings were guided by an agenda and noting the tangible results achieved or not achieved at the end of every meeting. Janet was the reliable one who would always have more for the group than was expected of her. Christine saw herself as meticulous and organized and as a person who tried to give her best in whatever she did.

It was now week 5 into the semester, and Christine was deep in thought about the OB assignment.

She had called everyone to arrange a meeting for a time that would suit them all, but she seemed to be running into a roadblock. Mike couldn’t make it, saying that he was working that night as a member of the campus security force. In fact, he seemed to miss most meetings and would send in brief notes to Christine, which she was supposed to discuss for him at the group meetings. She wondered how to deal with this. She also remembered the incident last week. Just before class started, Diane, Janet, Steve, and she were joking with one another before class. They were laughing and enjoying themselves before Sandra came in. No one noticed that Mike had slipped in very quietly and had unobtrusively taken his seat.

She recalled the cafeteria incident. Two weeks ago, she had gone to the cafeteria to grab something to eat. She had rushed to her accounting class and had skipped breakfast. When she got her club sandwich and headed to the tables, she saw her OB group and joined them. The discussion was light and enjoyable as it always was when they met informally. Mike had come in. He’d approached their table. “You guys didn’t say you were having a group meeting,” he blurted. Christine was taken aback.

We just happened to run into each other. Why not join us?” “Mike looked at them, with a noncommittal glance. “Yeah . . . right,” he muttered, and walked away.

Sandra Thiel had frequently told them that if there were problems in the group, the members should make an effort to deal with them first. If the problems could not be resolved, she had said that they should come to her. Mike seemed so distant, despite the apparent camaraderie of the first meeting.

An hour had passed, bringing the time to 3 P.M., and Christine found herself biting the tip of her pencil. The written case analysis was due next week. All the others had done their designated sections, but Mike had just handed in some rough handwritten notes. He had called Christine the week before, telling her that in addition to his course and his job, he was having problems with his girlfriend. Christine empathized with him. Yet, this was a group project! Besides, the final mark would be peer evaluated. This meant that whatever mark Sandra gave them could be lowered or raised, depending on the group’s opinion about the value of the contribution of each member. She was definitely worried. She knew that Mike had creative ideas that could help to raise the overall mark. She was also concerned for him. As she listened to the music in the background, she wondered what she should do.

Questions

1. How could an understanding of the stages of group development assist Christine in leadership situations such as this one?

2. What should Christine understand about individual membership in groups in order to build group processes that are supportive of her work group’s performance?

3. Is Christine an effective group leader in this case? Why or why not?

OB Case X Round-the-Clock Stress

Many employees feel that on-the-job stress is difficult to control, but at least when they get home they can relax. However, as the nature of work changes, the home is no longer the sanctuary it once was. With advanced information technology and customer demands for 24-hour service, an increasing number of employees are on call at all times or working the “graveyard” shift that used to exist only for factory workers. For example, today there are numerous Wal-Mart stores, Walgreens drugstores, and supermarkets that never close. And consider the Heartland Golf Park in Deer Park, Long Island. A golfer who wants a late evening tee-off time can get one up to 3:00 A.M. The strategy has proven so popular that within 90 days of the time it was introduced, the wait time at midnight had grown to two and a half hours. Avid golfers do not mind, however, as the course is well lit and they can play as if it were high noon.

All around the country, businesses are realizing that there is a great deal of profit that can be added to the bottom line if they remain open outside of “normal” hours. One research firm estimates that this strategy can add 5 percent to overall profits, a hefty sum given that more and more businesses are finding their profit margins being narrowed by the competition.

In some cases, the decision to expand working hours has been a result of customer needs. Kinko’s

Inc. moved to a 24-hour schedule when people literally started banging on their doors after regular business hours and asking them to let them come in for desperately needed photocopies. As a news article recently put it, “The company’s . . . stores are magnets for ambassadors of the night: everyone from dreamers pursuing secret schemes and second careers to executives putting the final touches on tomorrow’s presentation.” In Chicago, Kinko’s set up an office in the lobby of the Stouffer Renaissance Hotel, a favorite spot of international executives. Customers from different time zones had been coming down at odd hours to ask the hotel to fax materials abroad and to help them with their desktop publishing. The hotel was not equipped to provide these services, so it asked Kinko’s to help out. The guests are delighted with the new service, and the hotel is happy to be able to accommodate them thanks to their profitable arrangement with Kinko’s.

Banks have also begun to offer 24-hour service. In addition to their ATM machines, which can be found just about everywhere, some banks now offer round-the-clock service: customers can call in and find out within 10 minutes whether they qualify for a new-car loan. A growing number of banks also offer after-hours customer services ranging from safe deposit boxes to $1,000 credit lines to overdraft protection. All the customer has to do is call in at any hour and provide the necessary information.

Some critics are concerned that this development will result in increasing costs to business and added stress to employees. After all, when people work late at night or put in a 15-hour day, they are likely not only to make far more mistakes than if they were on a 9-to-5 schedule but also to become fatigued and burned out. Nevertheless, at the present time approximately two-thirds of all U.S. workers, around 75 million people, do not work traditional 9-to-5 hours—and the number is definitely growing. Additionally, organizations that are engaged in international business, such as brokerage firms, are finding that their operations in Europe and Asia require them to keep odd hours. A U.S.-based broker must be up or on call in the wee hours of the morning because Europe’s stock exchanges are doing business. By the time the broker wraps up trading on the Pacific Stock Exchange in the early evening (Eastern Standard Time), there are only a few hours before the Asian stock exchanges open. Simply put, in an increasing number of businesses, it is possible to work round-the-clock—and, of course, to pick up the stress that goes along with this lifestyle.

Questions:

1. How would a Type A personality feel if his or her organization suddenly announced that everyone was to be on call 24 hours a day because the company was moving to round-the-clock customer service?

2. How would psychological hardiness help people deal with these emerging round-the-clock operations?

3. What are some ways employees and their organizations could cope with the stress caused by these new round-the-clock developments?

OB Case XI Doing My Own Thing

Rita Lowe has worked for the same boss for 11 years. Over coffee one day, her friend Sara asked her, “What is it like to work for old Charlie?” Rita replied, “Oh, I guess it’s okay. He pretty much leaves me alone. I more or less do my own thing.” Then Sara said, “Well, you’ve been at that same job for 11 years. How are you doing in it? Does it look like you will ever be promoted? If you don’t mind me saying so, I can’t for the life of me see that what you do has anything to do with the operation.”

Rita replied, “Well, first of all, I really don’t have any idea of how I am doing. Charlie never tells me, but I’ve always taken the attitude that no news is good news. As for what I do and how it contributes to the operation around here, Charlie mumbled something when I started the job about being important to the operation, but that was it. We really don’t communicate very well.”

Questions:

1. Analyze Rita’s last statement: “We really don’t communicate very well.” What is the status of manager-subordinate communication in this work relationship?

2. It was said in this chapter that communication is a dynamic, personal process. Does the situation described verify this contention? Be specific in your answer.

3. Are there any implications in this situation for interactive communication? How could feedback be used more effectively?

OB Case XII Harry Smart—Or Is he?

Harry Smart, a very bright and ambitious young executive, was born and raised in Boston and graduated from a small New England college. He met his future wife, Barbra, who was also from Boston, in college. They were married the day after they both graduated cum laude. Harry then went on to Harvard, where he received an MBA, and Barbra earned a law degree from Harvard. Harry is now in his seventh year with Brand Corporation, which is located in Boston, and Barbra has a position in a Boston law firm.

As part of an expansion program, the board of directors of Brand has decided to build a new branch plant. The president personally selected Harry to be the manager of the new plant and informed him that a job well done would guarantee him a vice presidency in the corporation.

Harry was appointed chairperson, with final decision-making privileges, of an ad hoc committee to determine the location of the new plant. At the initial meeting, Harry explained the ideal requirements for the new plant. The members of the committee were experts in transportation, marketing, distribution, labor economics, and public relations. He gave them one month to come up with three choice locations for the new plant.

A month passed and the committee reconvened. After weighing all the variables, the experts recommended the following cities in order of preference: Kansas City, Los Angeles, and New York. Harry could easily see that the committee members had put a great deal of time and effort into their report and recommendations. A spokesperson for the group emphasized that there was a definite consensus that Kansas City was the best location for the new plant. Harry thanked them for their fine job and told them he would like to study the report in more depth before he made his final decision.

After dinner that evening he asked his wife, “Honey, how would you like to move to Kansas City?” Her answer was quick and sharp. “Heavens, no!” she said, “I’ve lived in the East all my life, and I’m not about to move out into the hinterlands. I’ve heard the biggest attraction in Kansas City is the stockyards. That kind of life is not for me.” Harry weakly protested, “But, honey, my committee strongly recommends Kansas City as the best location for my plant. Their second choice was Los Angeles and the third was New York. What am I going to do?” His wife thought a moment and then replied, “Well, I would consider relocating to or commuting from New York, but if you insist on Kansas City, you’ll have to go by yourself!”

The next day Harry called his committee together and said, “You should all be commended for doing an excellent job on this report. However, after detailed study, I am convinced that New York will meet the needs of our plant better than Kansas City or Los Angeles. Therefore, the decision will be to locate the new plant in New York. Thank you all once again for a job well done.”

Questions:

1. Did Harry make a rational decision?

2. What model of behavioral decision making does this case support?

3. What decision techniques that were discussed in the chapter could be used by the committee to select the new plant site?

OB Case XIII Out with the Old, In with the New

The Anderson Corporation was started in 1962 as a small consumer products company. During the first 20 years the company’s R&D staff developed a series of new products that proved to be very popular in the marketplace. Things went so well that the company had to add a second production shift just to keep up with the demand. During this time period the firm expanded its plant on three separate occasions. During an interview with a national magazine, the firm’s founder, Paul Anderson, said, “We don’t sell our products. We allocate them.” This comment was in reference to the fact that the firm had only 24 salespeople and was able to garner annual revenues in excess of $62 million.

Three years ago Anderson suffered its first financial setback. The company had a net operating loss of $1.2 million. Two years ago the loss was $2.8 million, and last year it was $4.7 million. The accountant estimates that this year the firm will lose approximately $10 million.

Alarmed by this information, Citizen’s Bank, the company’s largest creditor, insisted that the firm make some changes and start turning things around. In response to this request, Paul Anderson agreed to step aside. The board of directors replaced him with Mary Hartmann, head of the marketing division of one of the country’s largest consumer products firms.

After making an analysis of the situation, Mary has come to the conclusion that there are a number of changes that must be made if the firm is to be turned around. The three most important are as follows:

1. More attention must be given to the marketing side of the business. The most vital factor for success in the sale of the consumer goods produced by Anderson is an effective sales force.

2. There must be an improvement in product quality. Currently, 2 percent of Anderson’s output is defective, as against 0.5 percent for the average firm in the industry. In the past the demand for Anderson’s output was so great that quality control was not an important factor. Now it is proving to be a very costly area.

3. There must be a reduction in the number of people in the operation. Anderson can get by with two-thirds of its current production personnel and only half of its administrative staff.

Mary has not shared these ideas with the board of directors, but she intends to do so. For the moment she is considering the steps that will have to be taken in making these changes and the effect that all of this might have on the employees and the overall operation.

Questions:

1. What is wrong with the old organizational culture? What needs to be done to change it?

2. Why might it be difficult for Mary to change the existing culture?

3. What specific steps does Mary need to take in changing the culture? Identify and describe at least two.

OB Case XIII For Leadesrs, Ignorance Isn’t Bliss

About two years before he died, Peter Drucker told an interviewer that among the things he regretted in the course of his long and productive career was not writing a book—it would have been his 40th—called Managing Ignorance. He added, tantalizingly, that it was bound to have been his best, but otherwise he didn’t elaborate.

Most likely, it seems, Drucker was interested in figuring out how those running corporations and other institutions could get their arms around what they don’t know [which, of course, tends to greatly outweigh what they do know]. “As significant as the problem of organizing knowledge was,” noted John Flaherty in Peter Drucker: Shaping the Managerial Mind, “he considered the organization of ignorance an even more formidable challenge.”

Possibly, too, Drucker was referring to the need for all of us, whether a top executive or an hourly employee, to engage in lifelong learning. As Drucker pointed out, with the world moving so fast, “today’s advanced knowledge is tomorrow’s ignorance.” Or perhaps he would have taken the opportunity to underscore a lesson that one of his students, William Cohen, recalls in his new book, A Class with Drucker: “You must frequently approach problems with your ignorance—not what you think you know from past experience, because not infrequently, what you think you know is wrong.”

And yet I keep coming back to another idea. Maybe, just maybe, Drucker would have zeroed in on a phenomenon that has brought down some of the biggest-name executives in Corporate America, and will undoubtedly bring down more: blind ignorance—the tendency, as one scholar has defined it, toward “ignorance of self-ignorance.”

How else can anyone explain what happened to Zoe Cruz, whose sacking as co-president of Morgan Stanley (MS) made her the most recent high-profile casualty of the mortgage crisis on Wall Street? Ostensibly, Cruz’s forced retirement was the result of the firm losing billions of dollars on subprime-related securities. But there is little question that her sudden fall, after 25 years at Morgan Stanley, stemmed as much from the way she mishandled colleagues—and evidently couldn’t perceive the tremendous harm it was causing—as from the way she misjudged financial risk.

By all accounts, Cruz was polarizing. Her aggressiveness earned her the moniker “Cruz missile.” And she had a propensity for playing politics. She shamelessly backed then-Chief Executive Philip Purcell while eight former Morgan Stanley executives were advocating his ouster in 2005—and then somehow not only survived but reached new heights under Purcell’s replacement, current CEO John Mack.

“Many people at Morgan resented and mistrusted her because of her defense of Purcell,” says Patricia Beard, whose Blue Blood and Mutiny: The Fight for the Soul of Morgan Stanley chronicles Purcell’s tussle with the Group of Eight. “They were not sad to see her go.”

Being disliked is not necessarily a problem in and of itself. “Popularity,” Drucker wrote, “is not leadership; results are.” Yet Cruz’s flaws apparently went deeper. For instance, she is reported to have rebuked fellow employees for the mortgage losses while sidestepping responsibility for her own role in the debacle. If that’s what she did, it was a huge mistake; nothing can undermine one’s position of authority more quickly. “Effective leaders are rarely ‘permissive,’” Drucker asserted. “But when things go wrong—and they always do—they do not blame others.”

At the same time she was pointing fingers, Cruz is said to have discouraged dissent, another cardinal sin in Drucker’s eyes. “Decisions of the kind the executive has to make are not made well by acclamation,” he advised.“They are made well only if based on the clash of conflicting views, the dialogue between different points of view, the choice between different judgments. The first rule in decision making is that one does not make a decision unless there is disagreement.”

What’s fascinating to me is how someone as bright and accomplished as Cruz could behave in this manner. Surely she must have known that those around her believed her style to be terribly toxic and that, in the end, it might even prove her undoing. Then again, may be not. In September, an article in Harvard Management Update examined just how difficult it can be for the most talented employees, especially those at a senior level, to absorb honest feedback about their performance. It’s not simply that they don’t want to see their weaknesses; they’ve almost been preconditioned not to see them.

“Because they have rarely failed,” the piece quotes Chris Argyris of Monitor Group as saying, “they have never learned how to learn from failure.” Instead, they’re apt to “screen out criticism and put the ‘blame’ on anyone and everyone but themselves. In short, their ability to learn shuts down precisely at the moment they need it most.”

Beard recounts that in 2004, Cruz received a performance review from her then-boss, Vikram Pandit, which “included some negatives.” Cruz, who resented Pandit, disputed the evaluation and even went so far as to protest the findings to a member of the board.

In the short term, it worked. Pandit left Morgan Stanley for Citigroup (C), and Cruz continued to rise through the ranks. Ignorance as bliss, however, can only last so long.

Questions:

1. Summarize the famous management consultant and writer Peter Drucker’s position on “ignorance.” Do you agree?

2. Comment on the statement that Zoe Cruz’s demise at Morgan Stanley was because of the way she mishandled colleagues as from the way she misjudged financial risk.

3. Do you agree with the Druckerism that “Popularity is not leadership; results are”?

4. Based on your reading of this chapter, how would you have coached Zoe Cruz to be a more effective leader?

OB Case XIV How Is This Stuff Going to Help Me?

Jane Arnold wants to be a manager. She enjoyed her accounting, finance, and marketing courses. Each of these provided her with some clear-cut answers. Now the professor in her organizational behavior course is telling her that there are really very few clear-cut answers when it comes to managing people. The professor has discussed some of the emerging challenges and the historical background and ways that behavioral science concepts play a big role in the course. Jane is very perplexed. She came to school to get answers on how to be an effective manager, but this course surely doesn’t seem to be heading in that direction.

Questions:

1. How would you relieve Jane’s anxiety? How is a course in organizational behavior going to make her a better manager? What implications does an evidence-based approach have?

2. Why did the professor start off with a brief overview of emerging challenges?

3. How does a course in organizational behavior differ from courses in fields such as accounting, finance, or marketing?

OB Case XV Same Old Practices Won’t Lead to Improvement

At one hand, organizations appear for specific set of reasons while at other, many of them disappear too for some set of reasons. Living organizations are very open to recognize small changes in environment, basically the taste and preferences of customers. They consist of not only people as a mere head count, but people with right skills at right work. So far such living organizations continuously strive for improvement and improvement. We can refer them as learning organizations.

Learning organization is not a new concept. Nonetheless, it was Peter M. Senge who studied how organizations develop adaptive capabilities at Massachusetts Institute of Technology conducted workshops massively, published number of articles along with very popular book The Fifth Discipline in 1990 and brought this concept into limelight and popularized this concept worldwide. As a result, business houses like IBM, Hilton Worldwide, American Cancer Society (not-for-profit) and many others having value for improvement around the globe started to put the idea into practice to grow and sustain.

In our context, government organizations are reluctant to change and acquire newness in their overall dimensions – people, process and product. There most of employees in public front lack sense of warmth and accountability towards citizens. They are too much conventional at work and look happy and proud for their status quo.

Kiran Gautam – management consultant by profession for last eight months in working Nepal, manages his schedule and finds a slot to pay the vehicle tax and other charges being a responsible citizen. He visits the Transport Management Office (TMO), Bhaktapur located nearby his firm. He gets surprised and feels panic to see the huge crowd of more than hundreds of customers on unmanaged so long queue on the road outside the premise of office. When he comes to know there is only one terminal to receive revenue, all of sudden he remembers the horrifying incident happened with him some ten/eleven years ago on the same month of Ashad. All the pictures of same incident pops up in his head, the struggle he did to pay the tax for his motorbike, the standing on long line under scorching sun – almost roasted without water, non-sense dealing with annoying agents, brokers, noise and crowd. He also recalls how painfully with hustle and bustle he finished the task in almost three hours.

Kiran holds PhD from University of Queensland, Australia and stayed there for eight years. He is familiar with responses of government employees and their promptness to support, care and service towards the taxpayers, ambience of workplace, sitting longue, drinking water, coffee or other facilities and mainly massive use of IT and online system in Australia. But, exact opposite condition make him realized that for decades our government organizations have been simply indulged in same poor old practices.

This time he spent nearly two hours, though he expects it to settle in no more than 30 minutes. As consequences, he misses some of his valuable appointments and unnecessarily bound to cling with some hassles and stress.

He believes time is so precious asset and the scarce resource that truly can contribute to nation’s economy; and also the comfort and several facilities must be there as the taxpayers deserve them. Further, he realizes that some easy intervention can solve problems and save enormous scarce time of all service seekers.

If the same were the story of private sector organizations, they would have shut down their business. It’s not the luck or chance to have committed employees and committed customers.

Eventually for effective public service delivery to all prospective taxpayers, he decides to prepare some easy, practical, feasible guidelines backed with technical and financial data and would handover them for improvement.

Questions

1. Enlist the issues (both challenges and opportunities) presented in above case.

2. “Repetition of same old practices won’t lead to improvement.” Do you agree? Support your answer with some strong theoretical literature.

3. What would your prescription to change and develop such conventional workplace as in TMO, Bhaktapur?

(OB Case XV – Developed by Bhuwan Raj Chataut)

Credits:

Organizational Behavior: An Evidence-Based Approach, 12e, Luthans (2011) McGraw-Hill

Organizational Behavior, 15e Robbins & Judge (2013) Prentice Hall

Organizational Behavior,12e Edition- Schermerhorn, Osborn, Hunt, Uhl-Bien (2012) John Wiley & Sons

Compiled by:

Bhuwan R. Chataut, Faculty – HRM/OB, Shanker Dev Campus, Putali Sadak / Uniglobe College, New Baneshwor

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